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Elliott v. Credit Control Services

April 14, 2010

KATHY ELLIOTT, ON BEHALF OF HERSELF AND ALL OTHERS SIMILARLY SITUATED, PLAINTIFF,
v.
CREDIT CONTROL SERVICES, INC., DEFENDANT.



The opinion of the court was delivered by: Hon. Dana M. Sabraw United States District Judge

ORDER GRANTING DEFENDANT'S MOTION TO DISMISS [Doc. 17.]

Pending before the Court is Defendant Credit Control Services, Inc.'s motion to dismiss Plaintiff's First Amended Complaint ("FAC") pursuant to Federal Rule of Civil Procedure 12(b)(6). The Court finds the matter suitable for submission without oral argument pursuant to Local Rule 7.1(d)(1). For the reasons set forth below, the motion is granted.

I. BACKGROUND

Plaintiff brings this proposed class action lawsuit for Defendant's alleged violations of the Fair Debt Collections Practices Act ("FDCPA"), 15 U.S.C. § 1692 et seq. (FAC ¶ 1.) The basis for the complaint is a debt collection letter Plaintiff received from Defendant on August 13, 2009, informing Plaintiff she owed $61.27 for a previous debt. (Id. at ¶ 7.) The letter contains a bold heading stating "Warning Notice-Warning Notice" in white letters against a solid black background (Id. at Ex. A.) Underneath the heading is a text box stating:

This notice and all further steps undertaken by this agency will be in compliance with applicable State and Federal Law(s). In accordance with Federal Law, the following warning notice is required: This is an attempt to collect a debt and any information obtained will be used for that purpose. This communication was sent from a debt collector.

The above referenced balance is due for a laboratory test(s) ordered by your physician. These charges were not included in any bills you received directly from your physician and/or hospital, but were billed to you separately by our client.

If a claim has already been filed with your insurance company, it may have been denied or only partially paid.

Please remit payment in the envelope provided or visit our secure website at www.warningnotice.com. If you require personal assistance, please feel free to contact this office directly during the hours referenced above.

Thank you for your anticipated cooperation. (Id.)

Underneath the text box is a heading stating "Federal Law." Below that is a validation notice, required under federal law, which states:

Unless you notify this office within 30 days after receiving this notice that you dispute the validity of the debt or any portion thereof, this office will assume this debt is valid. If you notify this office in writing within 30 days from receiving this notice, this office will obtain verification of the debt or obtain a copy of a judgment and mail you a copy of such judgment or verification. If you request this office in writing within 30 days after receiving this notice, this office will provide you with the name and address of the original creditor if different from the current creditor. This is an attempt to collect a debt and any information obtained will be used for that purpose. This communication has been sent by a debt collector. (Id.)

Underneath the validation notice is a heading stating "California Law," which gives information regarding the Rosenthal Fair Debt Collection Practices Act and the federal Fair Debt Collection Practices Act. Following that section is further information regarding payment remittance. (Id.)

Plaintiff alleges that the notice violates 15 U.S.C. § 1692g because the required disclosure informing debtors how to dispute the debt is overshadowed by the "Warning Notice" heading and text box. (Id. at ¶ 20.) Plaintiff further contends that the letter is deceptive and misleading in violation of 15 U.S.C. § 1692e (preface) and (10), because debtors are tricked into believing the debt has priority over other debts. (Id. at ¶ 21.)

Plaintiff filed suit on November 24, 2009, and filed the FAC on February 16, 2010, after seeking leave of court. (Docs. 1 & 14.) Defendant filed the instant motion on March 2, 2010. (Doc. 17.) Plaintiff filed an ...


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